Posts Tagged ‘technical analysis’
It’s no secret that China is the biggest market for numerous raw materials, such as cement, steel, coal, copper, and oil, along with end-products, such as vehicles and mobile phones.
The growth of the middle class and wages in the country is the vital attraction for companies to go and set up shop there. Credit Suisse estimates the household wealth in the country will double to $35.0 trillion by around 2015, based on achieving sustainable gross domestic product (GDP) growth at or near the current growth rate. Moreover, the government’s strategy to drive domestic consumption will also help to push up the demand for goods and services.
An area in the Chinese economy that I continue to believe has tremendous long-term potential is the auto sector, but the short-term will pose some hurdles due to some buying limits imposed by the government.
The Chinese motor vehicle market is the largest in the world, and it continues to distance itself from the United States. The upward demand for vehicles remains in spite of the government’s efforts to limit vehicle sales in many of China’s largest cities in an attempt to cut pollution.
As a potential market for vehicles, China remains tops. Auto sales surged 16% in November following a 24% jump in October, according to the China Association of Automobile Manufacturers. (Source: China Association of Automobile Manufacturers web site, last accessed December 11, 2013.) About 1.7 million vehicles were sold for an annualized growth of 20.4 million. By comparison, sales of autos increased nine percent in the United States in November to an annualized rate of 16.4 million vehicles, according … Read More
Whether the lofty expectations pan out or not, believe it or not, there is more than one investment opportunity you can take advantage of to make money on the success of The Hunger Games series and other major Hollywood blockbusters.
The company behind the production of The Hunger Games is Lions Gate Entertainment Corp. (NYSE/LGF), which is already up over 100% from its 52-week low and could head higher if the film sets new records, meaning this production company may be an investment opportunity. In addition to films, Lions Gate also produces 28 television shows over 20 networks.
Chart courtesy of www.StockCharts.com
Fundamentally, Lions Gate has delivered decent results, beating the Thomson Financial consensus earnings-per-share (EPS) estimate in each of the past four quarters, making it a possible investment opportunity. Revenues are estimated to grow 6.4% to $2.93 billion in fiscal 2015 ending in March. Fiscal earnings are estimated to rise 50% to $1.54 per diluted share in fiscal 2015. While the best gains are behind the stock for the time, longer-term, I see Lions Gate as a good investment opportunity.
A second investment opportunity on the success of The Hunger Games series and other blockbusters is IMAX Corporation (NYSE/IMAX). IMAX offers venues in which you can see the film on a specialized 12,000-watt power-packed screen that could be as high as 98 feet. In general, every major blockbuster film is shown on IMAX screens around the world…. Read More
Have you noticed the cost of flying has become more expensive as the demand for travel rises in the airline sector? Rates have clearly been ratcheting higher. Not by much, but enough to drive up profits in what has been the high-flying airlines sector.
But this boost in market demand is not confined to America’s borders; rather, there has been an overall pick-up in global travel. Rising wealth in China, India, Asia, and Latin America combined has driven up the demand for airline travel and the associated services, such as hotels and restaurants.
The profit picture has turned upward. Airlines around the world are buying more planes. We are seeing a sort of renaissance in the airline sector, which is estimated to report revenues of $708 billion and profits of $16.4 billion in 2014, according to the International Air Transport Association (IATA). (Source: Frary, M., “Airlines to make $16.4 billion in 2014, says IATA,” September 24, 2013, Public Sector Travel web site, last accessed November 14, 2013.)
The IATA estimates 3.12 billion travelers will ride the air waves this year, representing the first time this figure has been in excess of three billion.
And with the price of oil and jet fuel stabilizing, we could see an expansion in margins for the airline sector.
The evidence of the strength in the airline sector is reflected in the chart below of the Dow Jones U.S. Airlines Index. Note the strong upside moves since the emergence of a bullish golden cross (as indicated by the oval surrounding the moving averages) at the beginning of this year. Also notice the strong relative … Read More
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